In trading, margin is the amount of money required to open or maintain a leveraged position – essentially a good faith deposit or collateral set aside by the broker. When you open a trade, the broker will “use” a certain portion of your account (the margin) to support that position. For example, on 100:1 leverage, a $100,000 position uses about $1,000 margin. Margin is usually expressed as a percentage of the trade size (e.g. 1% margin requirement). Unlike a fee, margin isn’t a cost paid; it’s locked up until you close the trade, then released back to equity (with profit or loss). Used Margin is the total margin currently tied up in all open trades. If your EA opens multiple positions, the used margin adds up, reducing Free Margin. Maintaining adequate margin is critical – if losses accrue such that your equity falls too low relative to used margin, you can hit a margin call or stop out (see below). In short, margin allows leveraged trading, but effectively it’s the portion of your account that must remain as security for your open trades.

Back to Robots Glossary Index